Reviewed by Mustafa Bilgic
Founder, WebCalculator
LTV is a standard lender metric. Rate bands vary by lender and market conditions. Mortgages are regulated by the FCA. Estimates only — not financial advice.
Your loan-to-value ratio decides which mortgage rates you can access. Enter the property price and your deposit (or mortgage amount) to see your LTV percentage, your equity, and the rate band you fall into.
Property price & deposit
Loan to value (LTV) is the size of your mortgage as a percentage of the property's value. It's one of the most important numbers in any mortgage application, because lenders price their deals in LTV bands — the lower your LTV, the cheaper the rates you can access.
On a £200,000 home with a £40,000 deposit, you borrow £160,000, so your LTV is £160,000 ÷ £200,000 = 80%. Your equity is the £40,000 deposit, or 20%.
Lenders set rate tiers at common LTV thresholds. Dropping below a threshold — even by a little — can move you into a cheaper band:
| LTV band | Deposit needed | Typical rates |
|---|---|---|
| 60% or less | 40%+ | Best available |
| 75% | 25% | Very competitive |
| 85% | 15% | Good |
| 90–95% | 5–10% | Higher rates |
A bigger deposit, paying down your mortgage, or a rise in your property's value all reduce your LTV. When you remortgage, a lower LTV often means a better rate. Work out how much you might borrow with the affordability calculator, then the monthly cost at your chosen LTV with the mortgage calculator.
Divide your mortgage by the property value, as a percentage. On a £200,000 home with a £40,000 deposit you borrow £160,000, so the LTV is £160,000 ÷ £200,000 = 80%.
The lower the better. The best rates usually start at 60% LTV or below. Common thresholds are 60%, 75%, 80%, 85%, 90% and 95% — dropping below one can unlock a cheaper rate.
A lower LTV means less risk for the lender, so you get lower rates and more deals. A bigger deposit reduces your LTV and can save thousands in interest over the mortgage.
Yes. Paying down the mortgage lowers it, and so does a rise in your home's value. That's why people often reach a better LTV band by the time they remortgage.